Major pairs were off to a slow session as traders from the U.S. and Canada were out enjoying the Labor Day holiday. The pound was still on weak footing, owing to weekend Brexit updates and downbeat U.K. manufacturing PMI.
- U.K. BRC retail sales monitor up 0.2% vs. 1.2% forecast, 0.5% previous
- Argentina announces austerity measures
- Trump reportedly canceled Labor Day plans to take trade calls
- U.S. and Canadian banks closed for the Labor Day holiday
Emerging markets in focus
In an effort to shore up their finances and secure a loan from the IMF, Argentine President Mauricio Macri announced new export taxes and spending cuts for next year’s budget.
However, this failed to lend some support for their currency, which already tanked more than 15% last week, but could prevent further concerns in emerging markets.
Earlier on, Turkey’s central bank announced an interest rate hike to keep inflation in check. Wondering what the situation is like over there? Here’s a handy primer on Turkey and a few quick updates.
Over in Brazil, the real took a dive to its lowest level in more than two years on worsening political uncertainty leading up to its presidential polls. This was seen to be spurred by the country’s Superior Electoral Court decision on Saturday to ban front runner and former President Luiz Inacio “Lula” da Silva from running.
Oil higher, futures muted
Crude oil continued to rake in more gains as traders appear to be pricing in the impact of the next round of U.S. sanctions on Iran.
- WTI crude oil is up 31 cents to $70.10 per barrel (+0.42%)
- Brent crude oil rose 37 cents to $78.01 per barrel (+0.48%)
Note that Iran already reported a decline of 150,000 barrels per day in the previous month, before another set of sanctions will be put in place by November.
Traders appear to be taking recent developments in trade and emerging markets in stride, with futures pointing to a bit of caution.
- Dow 30 index futures are up to 26,031.0 (+0.17%)
- S&P 500 index futures are up to 2,908.00 (+0.21%)
- Nasdaq futures are up to 7,677.15 (+0.22%)
Asian indices are also looking mixed:
- Nikkei 225 futures are in the green at 22,785.00 (+0.08%)
- China A50 index futures are up to 11,284.00 (+0.11%)
- Australia’s S&P ASX 200 futures are down to 6,300.5 (-0.43%)
Major Market Mover(s):
The pound slowed down with its slide and made a small bounce but was still the weakest among the bunch by the end of the trading day, unable to fill its weekend gaps.
GBP/USD inched down from 1.2888 to a low of 1.2854 before pulling up slightly to 1.2878, GBP/JPY tumbled to a low of 142.86, EUR/GBP kept climbing to .9027, and GBP/NZD retreated to a low of 1.9436.
Watch Out For:
- 1:30 am GMT: Australian current account balance (wider deficit of 11.1B AUD eyed from earlier 10.5B AUD shortfall)
- 4:30 am GMT: RBA interest rate statement (Here’s what to expect.)